£2bn for net-zero: SSE outlines bumper low-carbon spending plans for this financial year
Utility major SSE has unveiled plans to invest £2bn in low-carbon projects and supporting infrastructure this financial year, after posting a rise in profits led by renewable energy.
The firm published its full-year financial results for 2020-2021 this week, revealing that profits were buoyed against the Covid-19 crisis largely due to increasing revenue from wind projects. The firm stated that its renewable energy business has seen a 29% year-on0year increase in profits. Overall, operating profits were up 1%.
The results paper also shows that the business has reduced its absolute carbon emissions from Scope 1 (direct) and Scope 2 (power-related) emissions year-on-year. These results are partly due to improved efficiencies in-house, and partly due to the sale of fossil fuel assets and the addition of new clean energy capacity. On the former, SSE is set to sell its 33% stake in SGN, after selling its portfolio of natural gas exploration and production assets to Viaro Energy last year.
This progress, SSE has said, has set the company up to deliver on a commitment to invest £7.5bn in decarbonisation by 2025. The firm first announced this ambition last year, alongside a 2050 net-zero target.
Now, it has confirmed plans to allocate £2.5bn of this package during the 2021-2022 financial year. Major portions of this funding will be used for the construction of the Seagreen offshore wind farm in Scotland and the Dogger Bank offshore wind farm in North East England – the latter of which is set to be the world’s largest.
Funding will also go towards the development of the Viking onshore wind farm in the Shetland Islands; to electricity transmission and flexibility; carbon capture and storage (CCS) and hydrogen. To this latter point, SSE is working with Equinor to jointly develop a 1.8GW hydrogen power station at the Humber Industrial Cluster.
These projects feed into long-term plans to help the UK develop 75GW of offshore wind projects and five carbon capture and storage (CCS) and hydrogen clusters by 2040, and to reach net-zero by 2050. These visions are underpinned by science-based emissions reduction plans and a ‘Just Transition’ strategy designed to protect workers and communities impacted by the energy transition.
“We are a business with solutions to support decarbonisation across the economy, with options to create value and, when combined with our operational expertise, we are in a strong place to deliver towards the net-zero challenge,” SSE’s chief executive Alistair Phillips-Davies said.
The news from the firm comes shortly after the International Energy Agency (IEA) published its first comprehensive report on delivering net-zero globally. The report outlines how the global solar PV generation capacity should reach 630GW and the global wind generation capacity should reach 390GW by 2030. This is around quadruple current levels.
In the UK specifically, Ofgem this week revealed that it is working with seven of the UK’s largest gas and electricity networks to raise and allocate a further £300m in funding for low-carbon technologies across 200 projects.
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